Live blog and video of the Fed decision and Janet Yellen press conference

June 18, 2014, 1:29 PM ET

Follow along as MarketWatch live-blogs the interest-rate decision and forecasts from the Federal Reserve at 2 p.m. Eastern and the press conference with Chairwoman Janet Yellen at 2:30 p.m. Eastern. MarketWatch’s Rex Nutting and Laura Mandaro will be providing commentary, with charts and tweets relevant to the decision and the markets added in. Also watch WSJ Live’s coverage of the decision, the press conference, and the after-math.

Federal Reserve officials still think it’ll be a while before the Fed raises interest rates, according to the latest projections provided after the Federal Open Market Committee’s meeting ended Wednesday.

Only one of 16 officials thinks rates should rise this year, while 12 think 2015 will be the right timing. Three members say rates shouldn’t go up until 2016.

That timing on rate hikes is consistent with what the Fed has been saying for months, and it’s in line with market sentiment as well. Of course, a lot can happen between now and the end of 2015 to change hearts and minds.

Markets may focus on the latest “dot plot,” a graphic that shows what each Fed official thinks would be the appropriate rate level at the end of each year. The dot plot shows a slight upward movement, indicating a slightly faster pace of tightening than the last dot plot.

That could be a hawkish sign, or it could be meaningless. Fed chair Janet Yellen warned a few months ago that the dot plot was not the best way to think about Fed policy. For one thing, the dots include people who don’t have a vote on the committee.

A majority of Fed officials now think that a neutral federal funds rate — neither loose nor tight — is 3.75% That’s a change from the March projections, when most thought the neutral rate was 4%. The chart shows how the dots have changed from March to June.

The economy has underperformed since the recession. Gross domestic product grew just 1.8% in 2013, and is projected to increase just 2.1%-2.3% in 2014, largely because of the large contraction in activity in the first quarter due to bad weather and inventory clearing.

The Fed is not falling behind the curve on inflation, Yellen insists. She acknowledges that the inflation data have been “a bit on the high side,” but she judges some of that as being only “noise” in the data.

Generally, she says, inflation rates are gradually moving up to the Fed’s 2% objective.

The Fed is marking down its estimate of the longer-run neutral federal funds rate in part because it looks like the economy’s longer-run potential growth rate is a bit lower than projected earlier, Yellen says.

The drop in the unemployment rate to 6.3% overstates the improvement in the labor market, Yellen says. Some of the decline represents “shadow unemployment” of people who are discouraged about finding a job, but who would start looking again if their prospects improved.

That’s one reason the Fed will hold rates low even after the jobless rate hits 5.5%, because there will still be people who are gradually being lured back into the labor force.

Peter Boockvar of the Lindsey Group says he’s happy Steve Liesman asked about inflation that’s already topped the lower end fo the Fed’s 2015 inflation forecast. He takes issue with Yellen’s response, that the inflation data has been ‘noisy.’ From his emailed notes:

I’m not sure what that means because the CPI gains yesterday in particular were very broad based and we’ve seen two months in a row of 2% PPI. In terms of the 2y note and its reaction to the new ‘dot’ plot, the yield today is at .46-.47% vs .41% on the close on April 30th, the date of their last meeting.